The world watched in horror as a flooded power plant in Japan became the site of the worst nuclear disaster since Chernobyl, and now there are very serious concerns about a nuclear power plant in the U.S. heartland being inundated with historic flooding along the Missouri River.

Parts of the facility are already two feet underwater.

CNN's Brian Todd is in Nebraska for us. He's at the Fort Calhoun nuclear station. It's near Omaha.

Brian, what's latest?

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT: Wolf, at two nuclear power facilities here in Nebraska, officials are struggling to keep this historic Missouri River floodwater at bay.

This plant behind me is where the need is most urgent. This is the Fort Calhoun nuclear power facility just outside Fort Calhoun. Our photojournalist Mark Biello is going to zoom in where you can see the floodwaters creeping very, very close to the main building there and really engulfing some of the outer buildings around there. Now, this is the facility where yesterday a worker accidentally punctured a hole in a three-quarter-mile-long aqua berm that had been built to protect that facility. That berm had filled with water. A hole was punctured in it. It allowed that water and some of the floodwaters to creep closer to the building and surround the transformer.

That's a key development because as that point this plant had to go offline and be powered on generator power for a few hours. It's back on the power grid now, but officials here are keeping a very close watch on that, because as the water kind of stays near the power transformer, it does run the risk of a repeat of that Japanese Fukushima Daiichi situation where the floodwaters knocked out the power. They couldn't power the pumps that put water in there to cool the reactor, to cool the spent fuel rods at that plant, and three reactors melted down.

Obviously, they are trying to avoid a repeat of that here, and they say this plant is in a much different situation. They say it's much more safe right now, and they have this under control, but they are watching those transformers because, again, they power the pumps that send in the cool water to basically cool the reactor, to cool the spent fuel rods.

If the transformers are flooded, if they get knocked out, that's going to be a pretty dicey situation, but they say that right now this plant is safe, and they are operating off the regular power grid right now. This plant was shut down in April for refueling, so it's not actually functioning to power, you know, electricity around this area. But it is -- they still need the power to cool those rods, to cool the reactor, and that's what they are watching very closely as the water creeps toward that transformer.

At another plant 80 miles about south of here, that's the Cooper station plant, that's built on higher ground. It's a lot drier, but, again, the water, the Missouri River water is fairly close to that plant. They are keeping a very close eye on that.

Now, at this plant here, we're told we are going to get access to this plant within the hour. We hope to get inside, to see the real damage where it's at the worst point, and what officials here are saying about it. If we can get out in time, we will, of course, come out and show some of our viewers the pictures of what we saw inside.

Either way, we will show viewers those pictures as soon as we get out, Wolf, but, again, this is pretty much the most urgent area where officials are trying to keep the floodwaters from compromising this nuclear power plant -- Wolf.

(END VIDEOTAPE)

BLITZER: Brian Todd on the scene for us, we will check back with you.

Meanwhile, it's not water, but fire that's threatening the U.S. nuclear laboratory at Los Alamos, New Mexico. Mandatory evacuation orders have just gone out for people who live nearby. The lab itself was closed today because of the wildfire, which has already burned more than 44,000 acres. Special crews have been dispatched to protect the lab.

Officials there say all radioactive and hazardous material is accounted for and safe.

Let's go to Syria right now, where hundreds of pro-democracy demonstrators have been killed in months of protests against the regime of President Bashar al-Assad. Today, opposition leaders took a different tack and CNN was there.

We're the only U.S. television network with reporters inside Syria, and Yemen as well.

HALA GORANI, CNN CORRESPONDENT (voice-over): It was crowded in the barroom of a hotel in the Syrian capital Monday, where about 200 government opponents gathered for talks on democracy in Syria.

Some here have spent years in prison for speaking out against the regime, like this man, Luay Hussein, a prominent intellectual. He says the regime hasn't shown signs of wanting real change.

"So we must change this tyrannical regime to a democratic civilian one," he tells me. How that transition happens is a question this conference is trying to address.

(on camera): At this opposition meeting at a Damascus hotel, there are several of the signatories of the 2005 Damascus declaration that called for a democratic transition in Syria. But those who have been demonstrating in the protests across the country and those who represent them abroad say these individuals don't necessarily speak for them.

(voice-over): Wissam Tarif is a pro-democracy activist based outside of Syria.

WISSAM TARIF, HUMAN RIGHTS ACTIVIST: Are the people who have been protesting and taking the streets and asking for democracy and freedom of speech and a serious change and a change of regime, are those voices -- are in the conference.

GORANI: Responding to critics like Tarif, one of the conference organizers says there is room for more than one dissenting voice.

MAAN ABDUL SALAM, CIVIL ACTIVIST: I think it's time for us to say our political statement, the statement coming from the street, the statement coming from the authority, and the statement coming from everywhere outside the country. It's time for this group to say what they think and to find solutions.

For all the criticism and the support, dissidents gathered here don't forget the years they spent jailed for speaking out.

"If the street doesn't put pressure on the state to stop its dominance over society," Hussein says, "then we're definitely at risk of going back to jail, and for a very long time."

Something all opponents agree on: the fears and the uncertainty of what tomorrow's Syria may bring.

(END VIDEOTAPE)

BLITZER: And Hala Gorani is joining from us Damascus right now.

Hala, does the government of Bashar al-Assad, the president of Syria, have a problem with these dissidents, these pro-democracy activists meeting as openly, as they are, right in the Syrian capital?

GORANI: Well, it's an interesting question.

The organizers told me that they informed the authorities that they were going to meet, and they told the authorities in which hotel they were going to meet, and were waiting for a fax or a communique or some sort of note to be sent to them by the government acknowledging that they are aware that the gathering was going to take place.

They told me that up until 1:00 a.m. the night before, they had not received word from the government, and finally a note came through, and the meeting did take place in the end this Monday. Now, the government is authorizing/tolerating this meeting. They didn't sponsor it, but there are many critics out there.

You heard in my report saying that the dissidents who were meeting today at the Damascus hotel doesn't -- do not represent those protesters out on the streets of Daraa, of Jisr Al-Shugur. For one thing, they are of another generation. Another criticism that was directed at them is that they don't take part in any of these demonstrations and that they are giving a veneer of legitimacy to this regime by meeting in Damascus with the tacit authorization, approval of the government, Wolf.

So this meeting is -- did take place with dissidents that did hard jail time. These are definitely intellectuals who paid with their freedom for some of the things they have said against the regime. But many outside and inside of Syria are saying that perhaps this meeting is counterproductive in a way.

And one of the dissidents who was expected to attend, Aref Dalila, didn't show up, and he said he didn't want to give the impression that the regime is legitimate while killings continue in the country -- Wolf.

BLITZER: And just remind our viewers, Hala, because I want to be transparent with our viewers in the United States and around the world. You still are under severe restrictions where you can go, with whom you can meet; is that right?

GORANI: It is right. We are accompanied when we film out on the streets of Damascus by government minders. We're able to walk out on our own when we're not filming, when we're out doing the work of television journalists out on the streets of the capital.

But we are under close supervision. We ask for permission to shoot in certain neighborhoods where we know anti-regime demonstrations are either going to take place or are in the process of unfolding. And, in many cases, we're told: We're working on that permission. We're working on it. Just be patient with us.

And by the time we get the permission to go there, the demonstration and the demonstrators have disbanded. So, indeed, we are working under the close supervision of government minders, and we have very real restrictions when we do our job here.

But it is, Wolf, I have to say, still a fascinating insight into the story in Damascus. This is three months-plus into the uprising and our first opportunity to see the Syrian capital, and, as much as we can, talk to ordinary people away from the earshot of our government escorts.

BLITZER: Excellent. We're glad you're there, Hala. Thanks very much. We will check back with you tomorrow.

Forced labor, sexual exploitation, modern-day slavery, the U.S. State Department says those abhorrent practices are flourishing in countries including the Democratic Republic of Congo, North Korea, Saudi Arabia, and Iran. The department is out with its 2011 Trafficking in Persons Report. It's one of the most comprehensive analyses of worldwide human trafficking.

CNN has been going in-depth on the problem.

And the State Department has noted our efforts.

(BEGIN VIDEO CLIP)

LUIS CDEBACA, AMBASSADOR-AT-LARGE FOR HUMAN TRAFFICKING: A lot has changed in the last decade. The fight against trafficking has become a social and a cultural imperative. If you go to the Underground Railroad Freedom Center today, you will see an exhibit on modern slavery and how it affects you, because they realize that the walk to freedom didn't end 150 years ago.

It's a journey that someone is having to take every day. And just like the editor of that Harrisburg newspaper, the folks at CNN know that this fight is newsworthy, having aired dozens of stories in the last few months through their innovative Freedom Project.

HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: I have been caring about and working on this now for longer than a decade.

And the passion is there because it's such a violation of human rights and human dignity. To see men, women, and children forced into bondage, slavery, in the 21st century is just absolutely unforgettable and unforgivable.

So we do take seriously the mission that the United States, along with many international partners, has undertaken, which is to prevent and to prosecute and to do everything we can in our efforts to stop modern-day slavery. And that means we have to have partnerships, which is very important, and we have to protect those who are at risk and those who are put into it. So we went from three P's to four P's, but passion underlies all of them.

(END VIDEO CLIP)

BLITZER: You can learn much more about the problem of human trafficking through the CNN Freedom Project aimed at ending modern-day slavery. Go to CNN.com/freedom.

Is it airport security run amuck? There's outrage right now over allegedly what happened to this 95-year-old cancer patient, but now the TSA is telling its side of the story. We have details.

Also, hundreds of thousands of credit card accounts robbed -- new details coming out right now in the wake of a massive attack by hackers.

Plus, guilty on 17 corruption charges, so what's next for former Illinois Governor Rod Blagojevich?

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: A lot of people all across the United States were shocked and horrified when they heard about this. TSA agents apparently required, get this, a 95-year-old cancer patient to remove her adult diaper for a pat-down.

Now the TSA is responding.

Our homeland security correspondent, Jeanne Meserve, has the very latest for us.

MESERVE (voice-over): Ninety-five-year-old Lena Reppert, a leukemia patient, was going through security at a Florida airport on June 18. Because she was in a wheelchair, she was given a pat-down, and the Transportation Security Administration found a problem.

LENA REPPERT, AIRLINE PASSENGER: A wee bit embarrassing.

JEAN WEBER, MOTHER SEARCHED BY TSA: It had something to do with her Depends, that it was wet and it was firm and they couldn't check it thoroughly, she would have to remove it.

And I was -- I said, I don't have an extra one with me. Normally, this isn't a problem. And she said that she could not complete the security check without the Depends off.

MESERVE: Her nephew thinks it was ridiculous.

JIM SCOBEY, NEPHEW: I felt sorry for her, I mean, you know, her dignity and self-esteem.

MESERVE: The TSA says it didn't require Reppert to remove her diaper and provided the elderly woman and her daughter with options.

WEBER: They offered to get her bag off of the -- out of the plane and bring it back, so I could get a clean Depends. And I said, well, late -- I can't see how you can get the bag back here and I can get my mother changed in that amount of time.

REPPERT: I guess it bothered my daughter more than it did me, because I guess I'm too old to care.

MESERVE: Why was a diaper a security issue at all. Remember the so-called underwear bomber who allegedly tried to bring down a plane on Christmas in 2009? Authorities say Abdul Farouk Abdulmutallab had explosives sewn into his undergarments.

But why would anyone suspect a 95-year-old cancer patient in a wheelchair? Experts could plant explosives on anyone, but Lena Reppert's relatives aren't buying it.

SCOBEY: People have no common sense.

MESERVE: Common sense is exactly what the TSA promised after a video of a 6-year-old being patted down in New Orleans went viral earlier this year.

(END VIDEOTAPE)

MESERVE: Lena Reppert says she didn't let the incident bother her, but publicity about it is bothering plenty of other people and has intensified the debate over whether the TSA is in its lane or out of bounds -- Wolf, back to you.

BLITZER: Usually, there's an adult supervisor at some of these TSA locations at airports that does have a little common sense and could overrule what the TSA operators are doing, going by the book, if you will. There has to be a little reasonable common sense in these kinds of situations. What are they saying about that, Jeanne?

MESERVE: Well, what the TSA is saying is that the people at this checkpoint followed the established security protocols.

They are defending how they handled this. And I have to tell you, the more we learn today, the more gray this situation seemed to become. And it became quite unclear as to how much of this was forced on this woman by -- by the TSA and how much her daughter volunteered to do.

In an interview with CNN this afternoon, the daughter said it was her decision to take off the undergarment. So there really are still a lot of questions here, Wolf.

BLITZER: All right, well, keep checking, because there's high interest in this and a lot of outrage out there right now. And I know they are doing their job the best they can, but sometimes you have got to have a little common sense in dealing with a 95-year-old cancer patient, a survivor in a wheelchair in a situation like this, with her daughter present.

All right. Thanks very, very much.

You can interview them, get some questions, see if they do have any connections with al Qaeda or whatever. That could be clarified pretty quickly.

All right, we are learning right now just how many millions of dollars hackers stole when they infiltrated hundreds of thousands of supposedly secure accounts belonging to Citigroup credit card customers.

Lisa Sylvester is here. She is joining us with this part of story.

Lisa, what do you have.

LISA SYLVESTER, CNN CORRESPONDENT: Hi there, Wolf.

Well, actually, nearly three million taken from Citigroup customer credit card accounts. Citigroup says customers are not on the hook for that money and it's already been put back in the customers' accounts, but this is only the latest example of hackers growing bolder by the day.

(BEGIN VIDEOTAPE)

SYLVESTER (voice-over): Two-point-seven million dollars swiped from customers' credit card accounts. Citigroup says the money was taken from about 3,400 customer accounts. The thieves were able to tap into, though, nearly 100 times as many accounts, 360,000 during the May security breach.

Security analysts say it's part of a wider trend of cyber-attacks on the rise, Sony Corporation, Lockheed Martin and various other agencies.

HEMU NIGAM, SSP BLUE: In the olden days, when a bank robber would come through the front door of a bank, whatever money you had in that bank, it would be gone. Now bank robbers are coming through digital doors that you can not even see.

SYLVESTER: Citigroup isn't saying whether it knows who is behind the attacks, citing the ongoing investigation. A spokesman added: "Our customers are 100 percent protected from any fraud. We don't want our customers thinking they are liable."

But even still, data thieves can bide their time and strike weeks or even months after stealing personal information. Consumers Union urges people to monitor their accounts on a weekly basis.

IOANA RUSU, CONSUMERS UNION: A lot of times, the way these things work is, identity thieves will place small transactions on your account, maybe $10, maybe $15. You don't recognize it. You probably won't follow up on it. It's a very small transaction, but they place these transactions on hundreds of thousands of accounts, hoping that nobody will follow up and report on it.

SYLVESTER: Consumer groups are also pushing for a federal policy outlining requirements for data storage of customer information. Right now, it's left up to each state to decide the rules.

RUSU: What we would like is for there to be a standardized policy coming from here, from Washington, that tells companies, these are the ways to store information, these are the ways to keep the information safe, and in case of a data breach, this is what you have to do to notify.

(END VIDEOTAPE)

SYLVESTER: Now, 46 states have their own legislation in place on cyber-security breaches, and legislation has been introduced in Congress to have one uniform policy.

One proposal would require that companies who -- that collect personal information on more than 10,000 people in a 12-month period, they would have to disclose the breach. Right now, Wolf, the rules are all across the board.

BLITZER: All right, thanks very much. Good report, Lisa.

Another case, by the way, involving Citigroup to tell you about, this one involves one of its own. The former Citigroup executive Gary Foster is under arrest, accused of embezzling more than $19 million from the bank. He allegedly transferred the money into his own personal account. Citigroup spotted the suspicious activity and notified law enforcement.

From the governor's mansion to most likely a federal prison -- a jury in Chicago hands down multiple guilty verdicts for Rod Blagojevich. The former Illinois governor says he's stunned and disappointed, but is his legal battle over?

And the biggest surprise at Wimbledon today wasn't on the court.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: She's a Tea Party favorite known for sometimes explosive rhetoric, but, today, Minnesota Congresswoman Michele Bachmann's tone was very much that of a national candidate as she announced her bid for the Republican presidential nomination.

She made the announcement in Iowa, where she was born, and which also happens to hold the nation's first caucuses, but her message wasn't entirely watered down.

(BEGIN VIDEO CLIP)

REP. MICHELE BACHMANN (R-MN), PRESIDENTIAL CANDIDATE: Our voice is growing louder. Our voice is growing stronger, and it's made up of Americans from all walks of life, like a three-legged stool. It's made up of peace-through-strength conservatives, and I am one of those. It is made up of fiscal conservatives, and I am one of those. It is made up of social conservatives, and I am one of those.

(CHEERING AND APPLAUSE)

BACHMANN: And it's made up of the Tea Party movement, and I am one of those.

(CHEERING AND APPLAUSE)

BACHMANN: It's a very powerful coalition that the left fears, and they should, because, make no mistake about it, Barack Obama will be a one-term president.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

BLITZER: CNN's Joe Johns has more on the newest Republican contender and what sets her apart from the GOP field.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN SENIOR CORRESPONDENT (voice-over): Tea Party darling anti-Obama fire-breather, now Congresswoman Michele Bachmann is ready for an even bigger microphone on an even bigger political stage.

BACHMANN: Maybe we need to send a change-of-address form to 1600 Pennsylvania Avenue.

JOHNS: With Sarah Palin still undecided, Bachmann may be the only woman among a field of male contenders. She's known for tough talk.

BACHMANN: The powers at be here in Washington, D.C., specifically in the White House, have been wrong about a few things.

UNIDENTIFIED FEMALE: Wrong about everything.

BACHMANN: Wrong about everything; is that it?

JOHNS: While seeking support, the 55-year-old Minnesota Republican will tout her ideology and biography. She and husband, Marcus, have five biological children. She's been a foster mother to 23 others. Bachmann is chairwoman of the House Tea Party Caucus and often rails against excessive government spending and what critics call Obamacare, but her message is not always on message, like this gaffe from New Hampshire.

BACHMANN: You're the state where the shot was heard round the world at Lexington and Concord.

JOHNS: That Revolutionary War battle actually happened in Massachusetts. Bachmann later admitted her mistake, though she blamed media bias for widely reporting it.

And this from Iowa about slavery and the men who wrote the nation's founding documents.

BACHMANN: The very founders that wrote those documents worked tirelessly until slavery was no more in the United States.

JOHNS: Not exactly. Many of the founders owned slaves. And delivering Tea Party reaction to the last State of the Union address, she appeared to look off-camera. Blame a two-camera mishap, but that didn't stop "Saturday Night Live" from poking fun.

(BEGIN VIDEO CLIP, "SATURDAY NIGHT LIVE")

UNIDENTIFIED ACTRESS: Unfortunately, that response was marred by some technical difficulties, and it seems that its core message wasn't properly conveyed. Accordingly, I have asked for this time tonight in order to try again. So here goes.

(LAUGHTER)

(END VIDEO CLIP)

JOHNS: Joe Johns, CNN, Washington.

(END VIDEOTAPE)

BLITZER: All right, let's get some more on Michele Bachmann right now.

Our chief political analyst, Gloria Borger, is here.

In this new "Des Moines Register" Iowa poll that came out over the weekend, she is statistically tied with Mitt Romney for number one.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Right.

She's -- yes, she's got the hometown advantage, born there in Iowa. And, look, she has a message to the Tea Party constituency. And, you know, when you look at Michele Bachmann -- and I have talked to lots of Republicans who kind of compare her to Howard Dean in 2004.

He kind of sucked all the oxygen up out of that race. Eventually, John Kerry got the Democratic nomination, but Howard Dean was a very important factor, not only before Iowa, but also after, because he -- he represented the liberal wing of the Democratic Party.

So she may -- may represent a very important wing of the Republican party. She's a very good retail politician. People have to pay attention to her, Wolf.

BLITZER: So if she's Howard Dean, Mitt Romney is John Kerry, 2000...

BORGER: Could be.

BLITZER: Is that the analogy you're trying to make?

BORGER: It could be. That's the analogy, and it could well be. I mean, obviously the front-runner right now is Mitt Romney. He's got the money; he's got the establishment backing, and that's where Kerry was.

BLITZER: Let's talk a little bit about her record in Congress. She's, what, five and a half years...

BORGER: Right.

BLITZER: ... or so, five years as a member of Congress. What is her record?

BORGER: Well, she's quite conservative. She's always been conservative on the social issues, conservative on the fiscal issues. Her -- her big claim to fame is that she is against government spending at all levels, including pork spending.

Now you and I know Congress very well, and everybody is against pork until they're for pork in their own districts. And the "L.A. Times" did some reporting over the weekend which showed that, in 2009, Michele Bachmann wrote a letter to the secretary of agriculture, praising the federal government for propping up pork prices.

She also applied for stimulus money after she voted. Against the stimulus, she applied for stimulus money in her district. And her father-in-law's farm was the recipient of farm subsidies, which she opposes, so this could be a problem for her if she continues in the race

BLITZER: I know in the new Congress, she wanted to be a leader.

BORGER: She did.

BLITZER: She ran for a leadership position. She didn't win. What do her colleagues think of her?

BORGER: They don't love her, Wolf. They have...

BLITZER: You're talking about Republicans, too?

BORGER: Republicans have some problems with her, because they feel she's not a team player. They feel that she always takes the opportunity to separate herself from the Republican Party, which, by the way, is something she's going to do on raising the debt ceiling.

In the end, the speaker of the House, John Boehner and the leader of the Republicans in the Senate, Mitch McConnell, are going to have to go along with some kind of package to raise the debt ceiling. She will oppose it. She opposed all the compromises made during the lame- duck session as well.

And so she wants to separate herself, be an outsider, even though she's been inside Washington. And, you know, people in Congress, when they've served and they know they have to make some tough decisions, they don't appreciate that.

BLITZER: Gloria, thank you very much.

He spent six years as Illinois' governor, and now Rod Blagojevich could spend more than three times that long in prison. We have details of his corruption conviction today.

Also, an accused mob boss and former fugitive reveals how he snuck back to Boston armed to the teeth.

(COMMERCIAL BREAK)

BLITZER: Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM.

What's going on?

LISA SYLVESTER, CNN CORRESPONDENT: Hi, Wolf.

Two apparent U.S. drone strikes have killed six suspected militants in Pakistan's volatile tribal region bordering Afghanistan. Thirteen other people also died. There have been 38 drone strikes in Pakistan this year, angering Islamabad. The Pakistani government has demanded they stop.

And the Los Angeles Dodgers are facing some hard hits financially. The team filed for bankruptcy protection today. The move comes less than a week after Major League Baseball blocked the Dodgers from signing a new $3 billion television deal. The Dodgers need the money to pay the players. The team's owners have been locked in a bitter divorce fight. The bankruptcy move could ease the way to selling the Dodgers.

And look at who turned up at Wimbledon today. Yes, that's Britain's royal newlyweds, Prince William and Katherine, Duchess of Cambridge, getting out the car there. They got a standing ovation from the crowd when they arrived at the royal box, and they got to see British player Andy Murray triumph on the court and move on to the quarterfinals.

Looking pretty good there. They're getting around.

BLITZER: Happy newlyweds. Who wouldn't be happy going to Wimbledon right now. Thanks very much.

So are violent video games putting your children at risk? The U.S. Supreme Court weighing in today. You're going to find out if it's putting violent games out of kids' reach.

And multiple verdicts of guilty rang out in the courtroom today for Rod Blagojevich. He could spend decades in prison. We're going to tell you what his first words to the press were after the stunning verdicts.

(COMMERCIAL BREAK)

BLITZER: Protecting children versus protecting free speech. That was at the heart of a closely-watched U.S. Supreme Court case, pitting the video game industry against the state of California. Now the ruling is out.

Let's go to CNN's Kate Bolduan. She's over at the Supreme Court for us.

Tell our viewers, Kate, what happened.

KATE BOLDUAN, CNN CORRESPONDENT: Hey there, Wolf.

Well, the goal of this law that is at issue here was to protect children from potentially harmful material, much like states regulate access to cigarettes, alcohol and even pornography.

But while the justices said this law may have been well- intentioned, they also said it went too far.

(BEGIN VIDEOTAPE)

BOLDUAN (voice-over): Fifteen-year-old Matt Myers is like most every teenager today.

MATT MYERS, HIGH SCHOOL STUDENT: Oh, that's not cool.

BOLDUAN: High school tenth grader can't get enough of video games like Call of Duty. Its most recent release, Black Ops, sold a record-breaking 5.6 million copies in the first 24 hours.

But games with even more brutal depictions of violence, like Postal Two, beheading women, mass killings, even urinating on victims, made for a fierce real-life battle between the video game industry and the state of California's law that would ban the sale of excessively violent games to anyone under 18.

JAMES STEYER, COMMON SENSE MEDIA: The loss here is a loss for parents and kids across this country. In this case, it's about the sale of ultra-violent content to minors, period.

BOLDUAN: The high court disagreed. Ruling 7-2, the justices said the game went too far, violating the game's free speech rights. Justice Antonin Scalia calling the law, quote, "seriously over- inclusive, because it abridges the First Amendment right of young people whose parents think violent video games are a harmless pastime."

Video-game makers argued they've already imposed an industry-wide rating system that effectively limits access of graphic material to minors, and stuck in the middle were parents. Two-thirds of American households have game consoles, and parents like Tim and Amy Myers are under constant pressure to buy the newest, hottest games.

TIM MYERS, FATHER: It's a challenge to keep the teenager off the game without you having to hover over them constantly.

AMY MYERS, MOTHER: I prefer if Matthew wasn't playing the games, not only because I think they're a little violent or very violent, but because I'd rather he do other things with his time.

BOLDUAN: As for their son, Matt, he's just looking for the next big battle.

M. MYERS: It's invigorating. It's captivating. I find it interesting, and it's also, in a major part, the game my friends are playing.

(END VIDEOTAPE)

BOLDUAN: States across the country were watching this case closely, but even they were divided on the issue. Now this ruling is sending a clearer message, making it harder for states to impose similar laws, but not only with respect to video games but probably also with things like movies or graphic lyrics to music, Wolf, all largely protected by free speech.

First of all, Jeffrey, were you surprised by this decision by the Supreme Court?

TOOBIN: Not at all. You know, one of the things about this particular court is, as we know, they are very divided, liberals and conservatives, about a lot of issues, but free speech is not one of them. This is a court where free speech claims often win. And in the oral argument, in all the lead-up to this case, it really seemed likely that they were going to strike down this law.

And Justice Scalia's opinion was actually very funny and very wise, and he talked about all the literature, children's literature -- "Hansel and Greta [SIC]" -- "Hansel and Gretel," Grimm's Fairy Tales, "The Iliad" and "The Odyssey" -- which are very violent just for their day. They didn't have the technology to be this violent. Video games...

BLITZER: So what are the -- what are the consequences from this decision?

TOOBIN: Well, I think the consequences, the status quo pretty much remains intact. These -- these games have the ratings that they do. Store owners are obligated to keep them from the kids who are -- for whom it's inappropriate. But the law is not going to be use to enforce it. I mean, there's really not going to be a lot of change in how American life works as a result of this decision.

BLITZER: There was another decision involving Arizona and campaign funding in Arizona that the Supreme Court ruled on today. Explain what happened.

TOOBIN: OK. This is, I think, a huge case that's part of a big, big development in the Supreme Court. As you'll remember, last year the Citizens United decision, the court said the First Amendment protects corporations from any probation on spending money in elections. This was another version of that case.

This was an Arizona law that said the playing field had to be somewhat even between candidates who spend a lot of money and candidates who don't spent a lot of money. Supreme Court said that's unconstitutional.

And where we really appear to be heading here is towards almost totally deregulating campaigns. No limits on campaign expenditures. No limits on who can give money, and no limits on how much they can give. That's really where the court's heading. This case is really another step in that direction.

BLITZER: So all of that campaign fund-raising, finance reform that so many have talked about in Washington over the years, McCain- Feingold, as a lot of our viewers will remember, what happens to all of that?

TOOBIN: Well, remember, in Citizens United, they already -- the Supreme Court already got rid of a big chunk of McCain-Feingold, but I think the rest of it, it's only a matter of time, as long as the Supreme Court remains constituted as it is.

This court really believes in free speech, as we saw in the video game, and their idea of free speech also includes spending money in campaigns. So they really look to me like they're on the verge of getting rid of all of McCain/Feingold and all of those kinds of laws.

BLITZER: Well, money talks in politics, and we'll see a lot more of it as a result.

Quickly, on Rod Blagojevich, the former governor of Illinois. He was convicted on most of those counts today. He's looking towards a long time in prison right now. Were you surprised by what happened?

TOOBIN: No, I was surprised he didn't get convicted the first time.

And what makes it worse for him this time is that he testified, so the judge is going to see that Blagojevich testified for seven days, and the jury didn't believe him. Judges don't like lying defendants. That's why most defendants don't take the witness stand.

So this judge really could give him a long time in prison. We're talking eight years, ten years. There are no mandatory sentencing guidelines, so it's all up to the judge, and Blagojevich is in a world of trouble.

BLITZER: Yes. He said he's going to go home and speak to his two little kids. He's 54 years old. He's facing many years in prison right now, but he'll be out until sentencing. We'll watch for that.

TOOBIN: And he's -- and Wolf, he's second consecutive Illinois governor to be convicted of felonies.

BLITZER: And about to go to jail, too. Thanks very much, Jeff Toobin, assessing what's going on for us.

Meanwhile, a legal attempt to take Libyan leader Muammar Gadhafi out of power. We'll explain the news, what's going on.

And some surprise twists and turns in the murder case that's captivated millions of people across the United States. We'll go to Florida for the latest developments in the Casey Anthony case.

(COMMERCIAL BREAK)

BLITZER: Some unexpected twists and legal maneuverings in the closely-watched trial of Casey Anthony, accused of killing her toddler daughter Caylee.

CNN's David Mattingly is joining us now from Orlando, Florida, with the latest on the case.

So what happened today in court, David?

DAVID MATTINGLY, CNN CORRESPONDENT: Well, we finally got some answers today, Wolf, solving the mystery of what happened over the weekend and why court was abruptly stopped. With that mystery going away, another is taking its place.

(BEGIN VIDEOTAPE)

MATTINGLY (voice-over): Court documents made public reveal, after 27 days on trial for her life, Casey Anthony's attorneys felt it necessary to stop everything and check on her mental well-being.

BELVIN PERRY, JUDGE: Based upon the reports that the court has reviewed, the court will find that the defendant is competent to continue to proceed.

MATTINGLY: Two court-appointed psychologists and a psychiatrist determined that Anthony is able to aid and assist in her own defense. But the details of their examinations are sealed. Her lawyers only say their request was based on privileged communications between Casey Marie Anthony and her counsel.

The announcement puts to rest speculation on the cause of the abrupt and mysterious halt to the trial on Saturday. Judge Belvin Perry sent everyone home with only this vague notice.

PERRY: As both sides concur that a legal issue has arisen.

MATTINGLY: That came a day after Casey Anthony was brought to tears in the courtroom, listening to emotional testimony from her mother and brother. A sharp difference from the Casey Anthony we see today, greeting her defense team with a smile, and appearing more animated and involved than she's seemed in days.

(END VIDEOTAPE)

MATTINGLY: But none of this has happened in front of the jury. They're completely unaware of what's been going on, because all of this, Wolf, has taken place with them out of the room.

BLITZER: And what about the testimony today, David? What are we hearing today?

MATTINGLY: Well, the highlight today is actually going on right now. We're hearing from an investigator, a private investigator who was guided by a psychic, who was searching the woods for Caylee Anthony's body where it was found. He says he was searching those same woods a month earlier and did not see her body.

The defense wants to put some doubt in the minds of the jurors that the prosecution's case claims that her body decomposed in that area. They're trying to show that someone else may have placed that body relatively early after that body was found -- before that body was found -- Wolf.

BLITZER: David, thanks very much. David Mattingly on the scene for us in Orlando.

Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now.

Lisa, what else is going on?

SYLVESTER: Hi, Wolf.

Well, Libyan leader Muammar Gadhafi is a wanted man. The International Criminal Court today issued arrest warrants for him, his son and his brother-in-law. They're accused of crimes against humanity in Libya's civil war, including murder and persecution. The White House says the warrants are another sign that Gadhafi has lost his validity.

Reputed South Boston mob boss James "Whitey" Bulger may have been right under the nose of police during his 16 years on the lam. In newly-released court documents, Bulger admitted he returned to Boston several times while, quote, "armed to the teeth," so he could take care of unfinished business.

He also admitted he went to Las Vegas on numerous occasions to play the slots. He even slipped across the border into Tijuana to buy medicine. Bulger and his long-time girlfriend were captured last week in Southern California.

And a lot of people out there are rooting for a tough Emperor Penguin. New Zealanders have nicknamed the penguin Happy Feet. The bird is recovering after veterinarians operated on him.

Take a look at some of these Twitter pics from New Zealand's Wellington Zoo. Veterinarians say they removed piles of what they called gunk that was in his stomach, including rocks, sticks and stones. And X-rays show that he also had a belly full of sand.

The penguin turned up on a New Zealand beach far from his home in Antarctica, and he may have been eating the sand to actually -- Wolf, to cool down. So he was in bad shape, but they're taking care of him. And hopefully, he'll have a full recovery. A lot of people rooting for the penguin.

BLITZER: Let's hope he does. Thanks very much, Lisa. See you back here tomorrow.

Just ahead, up close and personal with Michele Bachmann. Very up close and personal. Stay with us.

(COMMERCIAL BREAK)

BLITZER: ... (UNINTELLIGIBLE) season here in the United States. How else could one explain the head cam that's trailing Republican presidential candidate Michele Bachmann? Here's CNN's Jeanne Moos.

MOOS: Did we mention officially announcing for president? The campaign may be new, but Michele Bachmann's already got a favorite line.

BACHMANN: Barack Obama will be a one-term president.

A one...

... term president! MOOS: The only fly in the ointment, other than the one that landed on this Bachmann supporter's head, was when Chris Wallace of FOX News asked an indelicate question, based on what critics have said about Bachmann.

CHRIS WALLACE, FOX NEWS ANCHOR: Are you a flake?

BACHMANN: Well, I think that would be insulting to say something like that, because I'm a serious person.

MOOS: Wallace later apologized.

WALLACE: I messed up. I'm sorry.

MOOS (on camera): You know who probably really resents questions about Michele Bachmann being a flake? Her husband.

(voice-over) Dr. Marcus Bachmann is a clinical therapist with a degree in psychology. As she reached out to supporters...

BACHMANN: Nice to see you.

MOOS: ... he spent the whole time holding onto her waist.

If Bachmann did become president, her son might be the first mullet in the White House.

(on camera) One guy in particular has a picture of Michele Bachmann up here -- no, not a mental image. An actual camera strapped to his head. That's in addition to regular hand-held cameras.

DAVE DAVIDSON, PHOTOGRAPHER: The camera I'm wearing on my head -- you may have noticed, like a 6'5" tripod -- is called the Go-Pro.

MOOS (voice-over): Michele Bachmann definitely noticed it.

DAVIDSON: She called me doctor, and she was kind of joking that I looked like a surgeon, I guess.

MOOS: Freelance photographer Dave Davidson says the head cam takes a shot every few seconds.

Meanwhile, Bachmann started taking shots for a supposed gaffe. Speaking about her hometown of Waterloo, Iowa.

BACHMANN: It's like John Wayne was from Waterloo, Iowa. That's the kind of spirit that I have, too.

MOOS: Blogs went for the kill, saying it wasn't John Wayne, the actor, who was from Waterloo, but John Wayne Gacy, the serial killer, who lived there. No sooner had the snarky headlines appeared -- "Bachmann Compares Self to Gay Rapist Clown Serial Killer" -- than Bachmann's campaign told "The Washington Times" that actor John Wayne's parents did live in Waterloo.

So it turned out to be a cheap shot. Unlike the shot from the head cam, this is the camera's view of Bachmann. And this is Bachmann's view of the head cam.

Jeanne Moos, CNN...

DAVIDSON: Bring my head down like that, hon?

MOOS: ... New York.

(END VIDEOTAPE)

BLITZER: That's it for me. Thanks for watching. I'm Wolf Blitzer in THE SITUATION ROOM. For our international viewers, "WORLD REPORT" is next. In North America, "JOHN KING USA" starts right now.